QUESTION: Are books with high Amazon sales ranks — say, more than 200,000 — still a good bet for Fulfillment by Amazon?
ANSWER: Yes. If you want to sell for the best price you’ve got to ignore the lowballers and use FBA as your edge.
So, I’ll send a book with virtually any sales rank — up to 1 million — to FBA and wait for the sale, even if it’s a valuable book worth $100 to $200 (in those cases I wrap the book within my UPS box to prevent any bumped corners or torn dust jackets at the Amazon fulfillment center).
However, I’ve gotten a lot more conservative about sending bulk inventory to FBA since they implemented the long-term storage fee for items stored longer than 365 days. When they started that policy last year, I had to have more than 1,000 books destroyed I had already shipped to the warehouse or else get socked with a penalty of more than $1,000. Now that hurts — having to destroy inventory you’ve bought and paid for, then paid to ship to Amazon.
Of course the long-term storage storage fee wouldn’t apply to long-tail books you’ve hand-picked at library sales, etc., since the first unit of any ASIN is exempted from the 365-day rule. Yes, my standard practice before they implemented the long-term fee was to send them all as soon as I got them. Now I’ve got to be virtually 100% sure they’ll sell within a year before sending.
You can’t blame Amazon for trying to maximize the turnover at its warehouses, but they should have grandfathered-in those of us who were blindsided with the long-term storage fee last year.
Speaking of the long-term storage fee, it will be decreased effective February 15, 2012, from $45.00 per cubic foot to $22.50 per cubic foot, but will now be charged twice a year instead of once, as previously. More details:
Dear FBA Seller,
Fulfillment by Amazon’s (FBA’s) next inventory cleanup will take place on February 15, 2012. As communicated previously, on that date, and each six months thereafter, FBA will assess an upfront, Long-Term Storage Fee on inventory that has been in our fulfillment centers for 365 days or more.
Please note the following changes to the Long-Term Storage Fee. The fee will be decreased effective February 15, 2012, from $45.00 per cubic foot to $22.50 per cubic foot, but will now be charged twice a year. However, Units that were charged a Long-Term Storage Fee on August 15, 2011, will not be charged a Long-Term Storage Fee on February 15, 2012.
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2 Comments
Interesting article Steve. I’m just a little confused about a few things and perhaps you can clarify them for me. You mention, “Now I’ve got to be virtually 100% sure they’ll sell within a year before sending.” If your referring to long tail, or niche books with very high sales rankings and limited demand (up to a million, as you stated) how can you be so sure that these books will sell within a reasonable time span, particularly within 365 days, to avoid incurring long term storage fees? Also, please explain this a little further, “since the first unit of any ASIN is exempted from the 365-day rule.” Thanks.
Good question, Gene. What I was getting at is sending in “bulk” inventory to FBA. For example, if I’ve bought a case of toys, or a couple hundred overstock books (same title), my customary practice was to send it all to FBA immediately. Although I’d like to sell all my inventory as soon as possible, I didn’t really care if a certain ASIN was going to take 2 or 3 years to sell because my monthly FBA storage fee (about $75 for several thousand books) was a drop in the bucket compared to the cashflow. This “move it out” policy kept junk from accumulating in my basement, and kept me from losing track of my inventory.
So, when the long-term storage fee came up out of the blue, I had to reevaluate. Now, if I’ve got a large quantity of one thing — say 15 cases of a book with a sales rank exceeding 50,000, I’m going to send in only one case. I don’t want to take a chance that it won’t sell for a year, and get slapped with another long-term fee. Before, I just sent every piece of inventory as soon as I got it.
The long-term fee doesn’t apply to the first unit of an ASIN in your inventory. The fee only applies if you have a quantity of more than one.
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